Hedge fund Appaloosa LP is placing more pressure on Allergan to separate the roles of chairman and CEO in an effort to address the drugmaker's underperformance.
Appaloosa's founder and president, David Tepper, wrote a letter to Allergan's board of directors one week after the drugmaker reported disappointing earnings and shelved plans to sell its women's health unit.
"In the wake of last Tuesday's earnings call ... it should by now be readily apparent to all interested and responsible parties that Allergan requires a fresh approach," Mr. Tepper wrote. "We believed that the introduction of a seasoned independent chairman with extensive pharmaceutical experience could exert a favorable influence on executive decision-making."
In the letter, Mr. Tepper argues that an independent chairman could help boost the company's share price, which has fallen nearly 30 percent since last October. In addition, he wrote that most S&P 500 companies have the top roles split and a request to separate them "would hardly seem controversial."
Currently, the CEO and chairman roles are held by Brent Saunders.
At the end of the third quarter of 2018, Appaloosa held nearly 2 million Allergan shares.